The news: Venmo will let users split bills by scanning a picture of their receipts via their app, per a press release.

Venmo is trying to keep pace with rival wallets on new features—Apple launched receipt scanning earlier this year.

Why this matters: Venmo can’t afford to slip on wallet stickiness, especially as PayPal banks on the P2P wallet to drive its recovery. 

More than 40% of all P2P wallet users are Venmo customers, per our forecast—and that share is growing. However, that growth is contingent upon Venmo connecting with new P2P payment users like Gen Zers and college students—and retaining those users as they age.

Venmo has invested heavily into marketing to those groups to make that strategy possible, but it faces steep competition from platforms like Zelle. 

Despite lacking many value-add features like bill-splitting, Zelle benefits from instant transfers and being housed within users’ banking apps. We forecast Zelle will capture $600 million more in P2P payment volume than Venmo this year.

Recommendations for P2P apps: Gen Zers have multiple P2P providers vying for their attention and loyalty. To grow market share, apps need to prioritize onboarding and retaining Gen Zers who drive social events—and spending—with their friends.

With 42% of Gen Zers saying one person fronts the bill for shared expenses and then settles up with friends rather than asking to split a check, per Zelle research, P2P players should incentivize “Chief Friend Officers” to spend through their app through rewards for bill splitting.

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